16.2. Drugs 'R Us operates a mail-order pharmaceutical business on the West Coast. The firm receives an average of $325,000 in payments Chapter 16: Revenue Cycle and Current Accounts. Management per day. On average, it takes four days for the firm to receive payment, from the time customers mail their checks to the time the firm receives and processes them. A lockbox system that consists of ten local depository banks and a concentration bank in San Francisco would require Drugs ' RU s to pay a fixed fee of $6,500 per month. Under this system, customers' checks would be received at the lockbox locations one day after they are mailed, and the daily total would be wired from each local bank to the concentration bank at a cost of $9.75 per wire (this additional fee would be paid by Drugs 'R Us). Assume that Drugs 'R Us could earn 10 percent on marketable securities and that there are 260 working days and hence 260 transfers from cach lockbox location per year. a. What is the total annual cost of operating the lockbox system? b. What is the dollar benefit of the lockbox system to Drugs ' R Us? c. On purely financial grounds, should the firm initiate the lockbox system